Capital is an ambitious state-of-the-nation fiction … a street in south London. Photograph: Toby Melville/Reuters

Capital by John Lanchester (Faber, February)

John Lanchester's novel of money and the metropolis was published to high hopes – not least because its author had made a name for himself as a journalist on the side, explaining the crash in terms that even arts graduates could understand. Capital is an ambitious state-of-the-nation fiction with a positively Victorian breadth, dramatising many present-day obsessions, from bank meltdowns to Islamist terrorism, house prices to parking tickets. It follows a varied cast of characters grouped around a Clapham street recently colonised by the City rich: a Polish builder, a Zimbabwean traffic warden, a Senegalese footballer, a lonely old lady – and at the centre of it all, a banker and his spa-obsessed harpy of a wife.

Capital was generally well received by the critics. Claire Tomalin, fresh from her Dickens biography, praised Lanchester's reports from the front line of London life – for telling the reader what it's like to be detained without charge under the terrorism laws, or to receive a life-destroyingly small banker's bonus (not much more than the average yearly income). However, some reviewers complained that its episodic, soapy story lacked a central thrust; and that its language didn't have the energy of the big urban novels that it resembles, such as Tom Wolfe's The Bonfire of the Vanities. Either way, it's clever, thoroughly researched and an engrossing read.

The Chemistry of Tears by Peter Carey (Faber, February)

The consolations of clockwork lie at the heart of Peter Carey's 12th novel, which employs a large mechanical bird to link the stories of two unhappy people – the 19th-century father of a sickly boy, who is constantly searching for distractions to keep his son alive, and a modern museum curator mourning the sudden death of her lover. The dismembered automaton is delivered to Catherine Gehrig in eight tea chests by a colleague who believes that reassembling it will distract her from her grief. Packed in with it are the diaries of Henry Brandling, which recount his journey to the Black Forest, the centre of German clock-making, to meet a master craftsman capable of building a mechanical duck that can eat and excrete.

A mere duck will not do for the clockmaker, any more than clockwork, for all its engrossing ingenuity, will do for Carey. As well as being the birthplace of the cuckoo-clock, the Black Forest is the spiritual home to the German fairytale. The clockmaker's final, fantastic creation – reassembled and reanimated by Catherine in a classic Carey setpiece – is as much a creation of human yearning for the resolution of a story as it is an assembly of cogs and wheels.

While welcoming the novel for its research, its ingenuity and its picaresque energy, several reviewers complained that they found it hard to sympathise with the grieving Catherine, and that Carey's underlying exploration – of what it is that makes human beings more than "intricate chemical machines" – is unsatisfying. It's an ingenious construction, but not quite perfect in all its parts.

Skagboys by Irvine Welsh (Jonathan Cape, April)

Twenty years ago, Irvine Welsh published Trainspotting, now an undisputed landmark in British fiction. Ten years ago, he published Porno, a slick if relatively unloved sequel. This year, he published a prequel, Skagboys, about Renton, Sick Boy and Spud's descent into heroin use in early 1980s Edinburgh. The new book starts off like a blunt anti-Thatcherite epic, with Renton beaten up on a picket line during the miners' strike and Spud laid off from his job as a removal man, while pharmaceutical-grade heroin leaks onto the streets of the Scottish capital. Later it becomes more rambling and more personal, following the path of Renton's self-destruction, from university in Aberdeen back home to Leith, via a filthy squat in Hackney. Inevitably, Skagboys lost out in comparisons to the original. The writing is sometimes slack – it is based on unpublished drafts written before Trainspotting, and some readers felt that they were being fobbed off with reheated cabbage; it's about three times the length, yet it covers much of the same ground. Others loved it, with many fans placing it alongside Marabou Stork Nightmares in the "nearly as good as Trainspotting" file; one reviewer even compared it to Moby-Dick, calling it "close to magnificent". At the very least, it provides a full-on immersion in Welsh's Leith, with its unforgettable cast of radges, bams and junkies.

The Beginner's Goodbye by Anne Tyler (Chatto & Windus, April)

The fact that The Beginner's Goodbye, Anne Tyler's 19th novel, received a couple of distinctly tepid reviews will not deter her devoted readership. Even when not at the height of her powers, Tyler offers a dose of fictional solace and sustenance that few contemporary writers can provide. Part of what makes her fiction so comforting is its familiarity, and all the trademark Tylerisms are to be found in The Beginner's Goodbye: the shabby gentility of the Baltimore setting; the emotionally repressed and (literally) limp hero; the amusingly mismatched marriage; the fairytale ending.

Aaron Woolcott's world collapses when a tree crushes part of his house and kills Dorothy, his wife. It is turned upside down once more when she seems to return as a no-nonsense ghost. Although Tyler has tackled grief before, most particularly in 1991's Saint Maybe, in a rare interview she revealed that The Beginner's Goodbye was the first time she felt able to approach her feelings of loss and bewilderment following her husband's death 15 years ago. Much of the satisfaction of a Tyler novel stems from the skill with which she teeters on the brink of sentimentality, and some readers may feel she has slipped too far into feyness on this occasion. But, despite the whimsy, her sure comic touch, unfailing empathy and gentle wisdom win through.

Home by Toni Morrison (Chatto & Windus, May)

Frank, a traumatised black veteran of the Korean war, is angrily adrift in an America that remains as brutally racist as ever. News that his younger sister Cee is in peril from the depredations of a eugenicist doctor draws him back to the small Georgia town where they'd shared a loveless, hardscrabble childhood. Lotus had seemed "the worst place in the world ... nothing to survive or worth surviving for", but the damaged Frank and Cee must find the inner strength to make an accommodation with a place they could call home. Nobel laureate Morrison's 10th novel is an intense, striking read, though some critics found the book moved too briskly to develop and deepen her abiding themes of violence and fortitude, horror and love.

Bring Up the Bodies by Hilary Mantel (Fourth Estate, May)

For the first time in her novelistic career, Hilary Mantel has written a book that is like her previous one. Bring Up the Bodies is just as good as Wolf Hall, the product of a still-consuming passion for the transformation of historical detail into darkly vivid fiction. It narrates the events leading up to Anne Boleyn's execution, a climax arranged by Mantel's protagonist, Thomas Cromwell. As before, the novel is narrated from Cromwell's point of view, and the strange sympathy she creates for this servant of power faces new tests. In a brilliantly unsettling chapter, he interrogates the four doomed victims of the "plot" he has discovered: the men accused of being the Queen's lovers. We are used to these processes of threat and humiliation, but not to seeing them from the interrogator's point of view.

It is a big book, but with a turn of phrase to be relished in almost every sentence. The sharp-eyed Cromwell is the novelist's best accomplice, noticing every telling circumstantial detail, each "shadow of calculation" that crosses another's face. As in Wolf Hall, the story is told in the historic present tense, and for a very good reason. Mantel is unstitching history – reimagining events as provisional, undecided. Cromwell moves from one danger to another; there is no vantage point beyond events. Always there is risk. "Death is your prince, you are not his patron."

Lionel Asbo: State of England by Martin Amis (Jonathan Cape, June)

When Martin Amis bade temporary farewell to his Brooklyn brownstone to give his new novel its London launch, he had to spend a lot of time explaining to interviewers thatLionel Asbo was not intended as a two-fingered salute to the country he's written so provocatively about for so long. In fact, he says, he'd written most of this tale of a delightedly thuggish criminal who wins a fortune on the lottery before he left Britain, for family reasons, a year or so ago.

There's actually something rather affectionate in Amis's portrayal of Lionel, particularly in his tortured diction and the immense effort that he puts into keeping on the wrong side of the law in the grotty, vicious (and fictional) London borough of Diston Town. Why else would the author reward him with not only a bumper payday but the attentions of pneumatic glamour model (and poet) "Threnody"? Whatever Amis's real feelings about Lionel, the critics were predictably divided; they were, however, more inclined to give him a chance than they had been The Pregnant Widow's toffs cavorting around an Italian castle. Amis wouldn't be Amis if he didn't roam up and down the class scale like a demented pianist, but one suspect he finds it a little easier to have fun with the Lionels of this world.

Canada by Richard Ford (Bloomsbury, June)

Now we've been let into the secret of Richard Ford's success: in a recent interview, the Pulitzer prize-winner described how he began work on Canada, his seventh novel, 20 years ago – and then decided to store his notes in the freezer. He also revealed that when he was working on the book again, he told his doctor to tread lightly during an annual check-up; if Ford knew anything was wrong with him, he reckoned, he'd never finish it. Both details speak of a writer with exceptional dedication to his craft – and it shows. Canada is a wildly impressive novel that demonstrates what John Banville, reviewing it for this newspaper, called Ford's "unrelenting control" over his prose. It also boasts a gripping story.

Set in Great Falls, Montana, it is narrated by 16-year-old Dell Parsons, who is forced to run for the Canadian border when his parents, "the least likely two people in the world to rob a bank", do exactly that. The novel's opening line promises us that later – just in case a bank robbery wasn't thrilling enough – there will be murders. But there are also some fine character studies, a beautifully observed portrait of small-town life and a thought-provoking exploration of the complicated relationship – both actual and imagined – between two very different countries.

Ancient Light by John Banville (Viking, July)

John Banville's latest loops back to pick up the threads of a pair of novels from his pre-Booker-winning days. InAncient Light, we're dropped once more into the mind of ageing actor Alexander Cleave, first inhabited in 2000's Eclipse, then glimpsed slantingly in 2002's Shroud, which culminated in the fatal fall of his afflicted daughter, Cass, from a church tower on the Italian coast. Cass is one of the ghosts who haunt the pages of this dense, often wrenching novel; the other is Mrs Gray, mother of Alexander's schoolfriend Billy, with whom, at the age of 15, he embarked on an importunate affair.

With its fixation on past events and assiduous exposure of the fatal unreliability of memory (details and chronology slip and slide in Alexander's recollection; seasons shift in an instant from spring to autumn, the sun jumps back and forth across the sky), Ancient Light works well as a meditation on memory and the lies we permit it to tell us. But the novel comes to life when it shakes off philosophy and sinks into the sensory. The self-contained vignettes in which Alexander recalls his panting encounters with Mrs Gray are brilliant; Banville excels in his brightly lit descriptions of self-absorbed teenage lust.

Toby's Room by Pat Barker (Hamish Hamilton, August)

Pat Barker has a penchant – or perhaps compulsion – for revisiting her characters, most obviously in the Regeneration trilogy, which culminated with 1995's Booker prize-winning The Ghost Road. Here, she's back with the students of the Slade School of Art, whom we first met five years ago in her novel Life Class. Not that Toby's Room is a straightforward continuation: its narrative is split between 1912 and 1917, bookending Life Class's 1914 setting.

Barker's focus is art student Elinor Brooke, torn between a desperate desire for independence and a feeling (partly ascribed to Virginia Woolf, whom she briefly meets) that the war has nothing to do with women. But when her troubled brother, Toby, is reported "Missing, Believed Killed", she knows that she must find out what happened to him, and enlists the help of her one-time lover, Paul Tarrant. The novel's tension derives from the ambiguity of Elinor's search; the extent to which she simply wants to put to rest her doubts about Toby's mental state. More than 20 years after she first began writing about the first world war, Barker's determined unsentimentality is still impressive. Only she, maybe, could have a horribly injured soldier remark: "'You know the rules as well as I do. What happens out there stays out there.' He stood up. 'Along with my fucking nose.'"

Umbrella by Will Self (Bloomsbury, August)

Stream of consciousness is a notoriously challenging form, but it seems typical that Will Self would not restrict himself to one single mind. Umbrella waltzes between three minds and two people: his recurring character, the psychiatrist Zack Busner, in the 1970s and the present day; and a patient, Audrey Dearth, or De'Ath, or Death, who suffers from encephalitis lethargica, the so-called "sleepy sickness" which broke out in 1918 and left its victims locked in for decades, conscious but unresponsive. Busner brought the patients out of their open-eyed comas in the 70s, and by the present day is haunted by whether or not he did the right thing.

In prose uninterrupted by chapters or line breaks, a twisted version of the 20th century is woven and unpicked again. It is a postmodern vivisection of Modernism, analysing the dream and the machine, war as the old lie and a new liberation, and rituals sacred, profane and banal. Of course, it features Self's trademark satirical cadenzas, but this is perhaps his most humane book to date: his wit is tempered, becoming steelier and more ferocious. The world of medicine provides an emblem for Self's own concerns with language; how polysyllabic pile-ups and esoteric coinings can conceal ideas rather than make them precise, how language is the disease and the diagnosis. Self has never been shortlisted for the Booker, but Umbrella is such a linguistically adept, emotionally subtle and ethically complex novel that this could and should be his year.

Zoo Time by Howard Jacobson (Bloomsbury, August)

One hopes, for Howard Jacobson's sake, that the spiky exchange that opens his first novel since the Man Booker-winning The Finkler Question wasn't drawn from real life. In it, a reading group member demands that the narrator, novelist Guy Ableman, explain why he hates women so much; when he asks her to give him an example, she produces an extensively marked-up copy of his book. Not, perhaps, a moment that any writer would look forward to (particularly not one whose publisher has recently killed himself directly after they had lunch together).

Even more irritatingly, Guy came to the meeting only because of its proximity to his mother-in-law, "with whom I had for a long time been thinking of having an affair". Aha! We're in Jacobson territory all right; a land where desire simply won't do what it's told and pops up in the trickiest of places. You don't read Jacobson for a restrained and respectful delineation of what goes on between men and women; you read him for a no-holds-barred, bawdy and highly naughty glimpse into what we're all really thinking about doing to one another. And for the jokes, of which Zoo Time has plenty. Not sure that reader with the red pen would find them very funny, though.

Ian Hamilton … leans on the bar of a Soho pub in Ian McEwan's
Sweet Tooth. Photograph: David Levenson/Getty Images

Sweet Tooth by Ian McEwan (Jonathan Cape, August)

It will be enough for many that it's a new McEwan novel. That it's about spying and seduction will surely quicken appetites. But that Sweet Tooth also has a frisson of autobiography will add an unexpected gossipy buzz. For there in the novel is McEwan's friend Martin Amis as a young man – it is set in the early 1970s – reading The Rachel Papers to an enraptured audience. There is legendary publisher Tom Maschler, who helped to discover McEwan. And there is the New Review editor Ian Hamilton leaning on the bar of Soho's Pillars of Hercules doling out to new writers in his circle (as McEwan himself was) his distinctive form of very high praise ("not bad"). What's more, a central character is a writer, Tom Haley, with connections to the University of Sussex (from where McEwan graduated in 1970), who wins a literary prize with his rather odd first work – McEwan won the Somerset Maugham award in 1976 for First Love, Last Rites ...

But let's not get carried away. The story is told by Serena Frome, a Cambridge graduate who develops an intellectual crush on Solzhenitsyn and gets recruited to MI5, where her first real assignment is a skirmish in the cultural cold war. She surreptitiously funds the anti-communist Haley, with whom she is soon smitten – but what will happen when her cover is blown? In restaurants they talk about the war in Northern Ireland and the three-day week: early 70s Britain is grey and rather desperate; the service's offices are smoke-stained and unswanky. Think Le Carré, who is thanked in the acknowledgements for "irresistible reminiscences", with a touch of the tough-guy politics of Amis's Koba the Dread. (The book is dedicated to Christopher Hitchens, another mucker from those days.)

Yet this is (in more than one sense) no straightforward spy thriller. From the start the story seems oddly told, and there's a suspicion that more is going on than meets the reader's eye. It will come as no surprise to McEwan's legions of expectant admirers that Sweet Tooth is also a novel about books and writing – one in which the author has a great deal of fun, not only with his 70s past, and sex and secret agents, but with the idea of deception itself.

Boneland by Alan Garner (Fourth Estate, August)

The conclusion to Alan Garner's classic fantasy sequence, which began with his debut The Weirdstone of Brisingamen in 1960, has been 50 years in the making. "Trilogies are strange creatures," he admitted earlier this year, having previously said he could never write the novel "lurking within" book two, The Moon of Gomrath. "Why did it take so long for Boneland to gestate? All I can say is that it took as long as it took."

Like all Garner's work, the early books draw on myths and legends both universal and local; they describe the magical adventures of brother and sister Colin and Susan around Alderley Edge in Cheshire as they clash with and are changed by ancient forces beyond their control. In Boneland, time has moved on and Colin has grown up to become an astronomer, searching for his missing sister among the stars and out on the Edge; he cannot remember anything of his childhood. In another dimension, a Watcher looks for a Woman. Both must find what they're searching for, and fast, or "the skies will fall, and there will be only winter, wanderers and moon".

Philip Pullman describes Garner's work as a place "where human emotion and mythic resonance, sexuality and geology, modernity and memory and craftsmanship meet and cross-fertilise". From Harry Potter to The Hunger Games, adults have been enthusiastically reading children's books over recent years. Garner predates the crossover phenomenon by decades, but he's never been just a children's writer: he's far richer, odder and deeper than that.

The Casual Vacancy by JK Rowling (Little, Brown, September)

As with her world-conquering Harry Potter books, the contents of JK Rowling's first novel for adults will be a closely guarded secret until publication day. All we know so far is that, in true Potter style, it's a whopper at 512 pages; a "big book about a small town" in which horcruxes and golden snitches are replaced by council meetings and squabbles on the village green. Pagford appears to be an English idyll, but feuds and passions seethe below the surface, erupting into all-out war when the sudden death of Barry Fairbrother leaves an empty seat on the parish council. It's classic society-in-microcosm territory: Little, Brown promise a "thought-provoking" black comedy.

Merivel: A Man of His Time by Rose Tremain (Chatto & Windus, September)

Having won the Orange prize in 2008 for her contemporary novel The Road Home, Rose Tremain returns to historical fiction, and to the narrator of 1989's Restoration, in Merivel: A Man of His Time. It is 15 years since Sir Robert Merivel returned to Bidnold Manor in Norfolk; at the urging of his beloved daughter Margaret, he decides to tackle his middle-aged melancholy and, armed with a letter from his patron Charles II, sets off for Louis XIV's glittering palace of Versailles. Andrew Motion said of Tremain's historical fiction that "she manages to make good stories, ripping yarns … but when we read them we realise that she's up to something more ingenious than that, more modern, self-reflexive and complicated … We're having a good time in an old-fashioned sense but also being made to think about things." Tremain's 12th adult novel reflects her scope, luminous style and emotional resonance.

NW by Zadie Smith (Hamish Hamilton, September)

It's seven years since Zadie Smith's last novel, the Orange prize-winning On Beauty, during which time the literary world's fascination with her has remained undimmed. Fortunately, her new one is a triumph: the intertwined stories of a group of Londoners, linked by the council estate they grew up on, trying to negotiate adult life in an era of arrested development. Driven Natalie, who reinvented herself as the world's idea of a success, is coming off the rails; uncertain Leah is balking at the prospect of motherhood; for Nathan, it's been downhill since primary school. The complex topography of modern London is explored in a dazzling portrait of aspiration and apathy, change and continuity, the social and personal barriers between people and how they can be breached. As Smith threads together her characters' inner and outer worlds, every sentence sings.

The Testament of Mary … Colm Tóibín's Mother of God is far from the sorrowing and yet accepting figure familiar to most of us. Photograph: Carsten Koall/Getty Images

The Testament of Mary by Colm Tóibín (Viking, October)

Given that he wrote a collection of short stories entitled Mothers and Sons, we probably shouldn't be surprised that Colm Tóibín has devoted a whole novel to the most famous pair in western history. But his Mother of God is far from the sorrowing and yet accepting figure familiar to most of us: instead, Tóibín conjures a woman who continues to grieve angrily many years after her son's crucifixion. Furious with Jesus's disciples and unwilling to participate in the version of history being assembled by the gospel writers, Tóibín's Mary is a powerful, unsparing figure, quite typical of her creator's singular imagination.

Back to Blood by Tom Wolfe (Jonathan Cape, October)

A quarter-century on from Bonfire of the Vanities, Tom Wolfe's fourth novel promises to be another sprawling panorama of American life. This time he trains his reporter's eye and motormouth prose on "class, family, wealth, race, crime, sex, corruption and ambition" in Miami, where passions about immigration run high, with a jostling cast of characters that includes a Cuban mayor, a black police chief, an Anglo sex-addiction psychiatrist and his Latina nurse, plus numerous conceptual artists, crack dealers and dodgy Russians. The book's been in the pipeline for years, following a switch of publisher (and a vast advance) after the critical and commercial disappointment of 2004's I Am Charlotte Simmons: years when the society Wolfe seeks to anatomise has been in constant flux.

Dear Life: Stories by Alice Munro (Chatto & Windus, November)

As the only writer to sneak on to the Booker shortlist for a collection of short stories (with The Beggar Maid in 1980), Alice Munro easily deserves to end our list of the year's best fiction. If 2012 has been a strong year for the novel, it has been especially so for short stories, culminating with a new collection from the doyenne of the form. Dear Life, her 13th collection, not only returns to Munro country – the small towns and wide-open spaces around Lake Huron, Canada, where the author has lived for many years – but several of the stories draw with unusual directness on her own life and childhood memories. It has become a cliché to say her work embraces entire lives in the space of a few pages, and while this is certainly part of the quiet miraculousness of her talent, the stories are often ambitiously lengthy. Here, however, many are shorter and sharper than we have come to expect. Critics and writers, including AS Byatt, Margaret Atwood and Jonathan Franzen, have found different ways of saying that she is one of the greatest writers, of any kind and from any country, at work today. Fourteen new pieces from this peerless author, now in her 80s, are a cause for celebration.

The Yips by Nicola Barker (Fourth Estate, July): English fiction's great eccentric offers up a typically riotous saga featuring a washed-up golfer, an agoraphobic tattoo-artist, a Muslim sex therapist and many other Luton luminaries.

Mo Said She Was Quirky by James Kelman (Hamish Hamilton, August): His latest dramatic monologue is the first to be written in the voice of a woman.

The Daylight Gate by Jeanette Winterson (Hammer, August): Inspired by the infamous witch trials in Pendle, Lancashire, in 1612.

The Heart Broke In by James Meek (Canongate, September): A contemporary family drama of love and scandal, morals and fame.

John Saturnall's Feastby Lawrence Norfolk (Bloomsbury, September): Witchcraft, cookery and war in 17th-century England; the first in 12 years from the master of the historical behemoth.

A Possible Lifeby Sebastian Faulks (Hutchinson, September): Different narrators in different eras, all in search of human connections.

May We Be Forgiven by AM Homes (Granta, October): Sibling rivalry and self-invention in the dark heart of contemporary America.